The Walt Disney Company (NYSE:DIS) has announced plans to cut 7,000 jobs in a significant restructuring effort for the entertainment company.
The move aims to save $5.5 billion and make its Disney+ streaming service financially sustainable, following the service's first decrease in subscribers since its launch in 2019.
In a statement, boss Bob Iger said: "I have enormous respect and appreciation for the talent and dedication of our employees worldwide, and I'm mindful of the personal impact of these changes."
He added that the restructuring will position the company to better handle future disruptions and economic challenges.
Along with the job cuts, which represent approximately 3.6% of Disney's global workforce, the company reported an 8% increase in sales to $23.5 billion and an 11% rise in profit to $1.3 billion for the final quarter of last year.
However, Disney+ saw a $1.5 billion loss and a decrease of 2.4 million subscribers to 161.8 million.
The announcement led to a 5% increase in the stock price.
The group will now reorganise into three segments: entertainment, including film, TV, and streaming; sports-focused ESPN; and Disney parks, experiences, and products.
The restructuring addresses some of the concerns raised by activist investor Nelson Peltz, who criticised the company for excessive spending on its streaming business.